There’s a fight brewing in the Legislature over compensation for people wrongly accused of ripping off the state’s unemployment compensation system.

Democrats say the state’s response has been too little, too late for people who were wrongly tagged by a computer program for fraud. The error means thousands of people who collected benefits after losing their jobs were improperly sanctioned.

“To be told by your government that you’ve committed a crime, and then to have your money stolen from you and have 400 percent interest is just unconscionable,” said state Senate Minority Leader Jim Ananich (D-Flint), “and it’s something that we have to make sure that every individual who went through this tragedy, the 40 thousand individuals, are made 100 percent whole.”

“Many of them have legal costs. They’ve got legal counsel,” he said. “You’ve probably read in some of the papers that people actually went into bankruptcy, actually caused divorces.”

Gideon D’Assandro is a spokesman for the state House Republicans. He says the Legislature is already working on it.

“We have committee hearings scheduled this week for the Auditor General to come in, and next week, the (Unemployment Insurance Agency) is going to come in and answer for the mistakes that were made – in public,” he said.

The state Talent Investment Agency released a statement from Director Wanda Stokes. She said the state’s already gone to work on an overhaul of the Unemployment Insurance Agency:

“We want the UIA to be a place people can turn to when they are going through a difficult time, and we are focused on making sure people get the benefits they are entitled to. We have worked with state lawmakers to make reforms in the fraud determination system, and set those changes into law.”

Legislative hearings on the fiasco begin this week. The state also faces a class-action lawsuit that’s currently before the Michigan Court of Appeals.

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